Forexpros – The U.S. dollar remained modestly lower against its major counterparts on Monday, as market sentiment was buoyed by hopes for progress on stemming the euro zone’s debt crisis ahead of a key European Union summit later in the week.
During European afternoon trade, the dollar was down against the euro, with EUR/USD rising 0.36% to hit 1.3440.
German Chancellor Angela Merkel was to hold talks with French President Nicolas Sarkozy later in the day, to outline proposals for stricter enforcement of euro zone budget discipline, ahead of Friday’s summit.
Market sentiment was bolstered earlier after Italian Prime Minister Mario Monti unveiled a EUR30 billion package of austerity measures, designed to reduce the second-biggest debt load in the single currency bloc.
Also Monday, official data showed that retail sales in the euro zone rose more-than-expected in October, advancing 0.4% after a 0.6% decline the previous month.
Analysts had expected retail sales to rise 0.2% in October.
A separate report showed that investor confidence in the euro zone fell more-than-expected this month, remaining in negative territory for the fifth consecutive month.
The greenback was also lower against the pound, with GBP/USD advancing 0.33% to hit 1.5649.
Earlier in the day, U.K. data showed that service sector activity rose unexpectedly in November, advancing for the eleventh successive month although at a modest pace as incoming new business increased at the slowest rate of the year so far.
The Markit/CIPS Purchasing Managers’ Index for the service sector rose to 52.1 in last month from 51.3 in October, confounding expectations for a dip to 50.5.
Elsewhere, the greenback almost unchanged against the yen and the Swiss franc, with USD/JPY dipping 0.01% to hit 77.98, and USD/CHF easing down 0.03% to hit 0.9210.
The greenback was also lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD declining 0.35% to hit 1.0157, AUD/USD rising 0.31% to hit 1.0245 and NZD/USD rising 0.4% to hit 0.7803.
In Australia, industry data showed that job advertisements were flat in November while a separate report showed that company operating profits fell less-than-expected in the third quarter.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.23% to hit 78.57.
Later in the day, the Institute of Supply Management was to release a report on U.S. service sector activity. The U.S. was also to publish government data on factory orders.
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